No one can predict the future. You may loan your car to a friend or family member, only to get a call that an accident has happened in your car.
It is important to really understand your coverages and how car insurance works if another driver crashes your car.
Who Is Covered When Driving Your Car?
It can be confusing to understand who is covered to drive your vehicle. Though policies will vary, the general rule is that anyone living in your house is typically covered when driving your car, unless expressly excluded on the policy.
In many cases, everyone in the same household is actually required to be included on the vehicle’s insurance policy.
For those friends or family members who don’t live with you but use your car every once in a while – you can typically loan them your vehicle and not worry that they’ll be covered. Permissive use generally applies in these cases.
Car Insurance Follows the Vehicle
It’s a common misconception that car insurance follows the driver. In reality, car insurance follows the vehicle.This means that if you loan out your car to driver who is not excluded on your policy your car insurance is the primary coverage that would apply if a crash occurred. The driver’s insurance would act as secondary insurance.
Non-Permissive Use
If your car is taken without your permission, it can be difficult to prove you didn’t give permission. You’ll generally end up paying. However, if it’s clear you did not allow someone else to drive your car and an accident happens, one of a few scenarios could occur:
-Theft: If someone steals your car and causes an accident, you won’t be liable for damages/injuries to the other vehicle/driver. However, damages to your own vehicle would probably be covered under your own coverage.
-Use of vehicle by a friend or family member: If your friend takes your car without your permission, their coverage would likely pay first and yours would step in to fill in the gaps.
Decide Who Can Drive Your Car
Also remember, if there’s ANY chance a driver will use your car, think twice about excluding her. It could bite you in the end if she does have to use your car and something happens.
Finally, if you do loan out your vehicle, make sure you know whom you are lending it to. Don't let people you don’t trust take your vehicle, even for a short trip to the store.
An accident can happen at any time.